Canada GDP Numbers: What Borrowers Should Know
Much like the global economic landscape, Canada’s economy is constantly in flux. Gross Domestic Product (GDP) serves as a reliable indicator, providing insights and data into the economic health and prospects of the Canadian economy.
The most recent figures indicate that GDP contracted 0.3% in October, offsetting the 0.2% increase in September. The quarterly report, released on November 28th, revealed that GDP increased 0.6% in the third quarter of 2025. This post provides a deeper understanding of Statistics Canada’s latest data and its implications for borrowers in the Canadian market.
Key Takeaways
- The latest GDP numbers show the Canadian economy declined 0.3% in October.
- In 2024, GDP grew 1.5%.
- Preliminary estimates indicate the economy will grow by 0.1% in November.
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Latest GDP Numbers in Canada
Gross domestic product (GDP) measures Canada’s economic activity based on the total value of all goods and services produced in Canada over a specific period. Dividing total GDP by population yields the average economic activity per citizen, known as GDP per capita.
When tracked over many years, GDP can show whether Canada’s economy is growing or contracting. When GDP rises, it is a sign of good economic health. Meanwhile, contracting GDP indicates that Canada is not operating at full capacity and may be heading into, or already in, an economic recession.
Statistics Canada reported that the Canadian economy shrank 0.3% in October, offsetting the 0.2% increase in September.
Sectors that saw contractions include:
- The manufacturing sector declined 1.5% largely offsetting September’s increase.
- The public sector contracted 0.3% driven by a 3.3% decline in elementary and secondary schools, due to the province-wide teachers’ strike in Alberta.
- The mining, quarrying, and oil and gas extraction sector contracted 0.6% more than offsetting the growth from September.
- Transportation and warehousing declined 1.1% more than offsetting growth in September.
- The wholesale trade sector declined 0.9% more than offsetting the expansion in September.
- Retail trade fell 0.6%, down for the second consecutive month.
- The construction sector declined 0.4%, falling for the first time in six months.
Sectors that saw gains include:
- The finance and insurance sector rose 0.4%, marking its fifth consecutive monthly increase and helping to offset the overall GDP decline in October.
GDP Third Quarter of 2025
Statistics Canada’s Q3 GDP data recorded a 0.6% increase following a 0.5% decline in Q2. The Q3 increase was driven by a stronger trade balance, with imports down and exports up. Overall growth was subdued by declines in household and government final consumption expenditures and slower inventory accumulation.
Imports of goods and services fell 2.2% the largest drop since Q4 of 2022. Imports of unwrought gold, silver and platinum group metals fell in Q3 after a significant increase in Q2. Imports of industrial machinery, equipment, and parts declined partially in Q2, driven by the import of a large oil and gas platform module.
Exports of goods and services increased 0.2%, a slight gain from the significant 7.0% drop in Q2. The increase was led by higher exports of crude oil and crude bitumen (+6.7%) and commercial services (+1.7%). Decreased exports of unwrought gold, silver and platinum group metals moderated the overall increase this quarter.
Canada’s Economy Shrank 0.3% in October, With Growth Projected in November
October’s GDP contracted 0.3%, with the goods-producing and services-producing industries leading the overall decline. According to Statistics Canada’s preliminary estimate for November, GDP is expected to increase 0.1%. This advanced estimate is due to increases in educational services, construction, transportation and warehousing, partially offset by declines in mining, quarrying, and oil and gas extraction and manufacturing.
Housing Investment Increases
Residential investment, a key driver of the Canadian economy, increased in Q3. This increase was driven by a 9.1% rise in ownership transfer costs, which measure resale-market activity. Residential resale activity grew in all provinces except Newfoundland and Labrador, Prince Edward Island and Manitoba.
Residential renovations increased 1.2%, but were largely offset by a 0.8% decline in new construction as work put in place for apartments decreased in all provinces and territories except Nova Scotia and British Columbia.
Real Estate Rental and Leasing vs. Home Sales
The real estate rental and leasing sector rose 1.0% in Q3 and was up for a second consecutive quarter. Growth in the sector was mainly due to higher activity at the offices of real estate agents and brokers and activities related to real estate, up 7.0%. This reflects rising resale activity across Canada, particularly in the Greater Toronto-Hamilton and Metro Vancouver areas. Legal services, which derive most of their activity from real estate transactions, rose 1.1% in Q3.
Household Spending Increases
On a per capita basis, household spending fell 0.2% in Q3 after increasing 1.0% in Q2. Household final consumption expenditure fell 0.1% in Q3, as spending on passenger vehicles decreased 2.3%, offset by increases in expenditures on rent and financial investment services. Spending abroad fell 3.9% reflecting fewer international trips made by Canadians.
Frequently Asked Questions
What is GDP?
Gross Domestic Product (GDP) measures Canada’s total economic output over a specific period. It represents the monetary value of all finished goods and services produced domestically by Canadian businesses.
What is the GDP of Canada, and why is it important?
As of Q3 2025, Canada’s GDP rose by 0.6%, indicating economic expansion. GDP is a key indicator of whether our economy is performing well or if there are signs of a recession. A recession can be determined by two consecutive quarters of decline in real GDP.
What are the major industries in Canada?
Canada has a diverse economy, with key industries including natural resources (such as oil, mining, and forestry), manufacturing, the services sector (including real estate, education, and health), and, increasingly, technology and innovation.
Final Thoughts
The latest GDP numbers paint a complex picture of the Canadian economy. The bond futures market and economists are pricing in a rate hold at the December announcement.
With the economy reacting daily to interest rates, this may be an opportune time to prepare your finances if you are looking to purchase a home or renew or refinance your mortgage. Reach out to nesto mortgage experts to understand your borrowing capacity and solidify your mortgage strategy.
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